Garden Sales, Incorporated, sells garden supplies. Management is planning its cash needs for the second quarter. The company usually has to borrow money during this quarter to support peak sales of lawn care equipment, which occur during May. The following information has been assembled to assist in preparing a cash budget for the quarter a. Budgeted monthly absorption costing income statements for April-July are: ces Sales Cost of goods sold Gross margin Selling and administrative expenses: Selling expense Administrative expense Total selling and administrative expenses Net operating Income "Includes $18,000 of depreciation each month. b. Sales are 20% for cash and 80% on account. April $560,000 392,000 May $760,000 June $460,000 July $360,000 532,000 322,000 252,000 168,000 228,000 138,000 108,000 76,000 96,000 57,000 36,000 43,000 57,600 35,600 34,000 119,000 153,600 92,600 70,000 $ 49,000 $ 74,400 $45,400 $ 38,000 c. Sales on account are collected over a three-month period with 10% collected in the month of sale, 80% collected in the first month following the month of sale, and the remaining 10% collected in the second month following the month of sale. February's sales totaled $175,000, and March's sales totaled $230,000 d. Inventory purchases are paid for within 15 days. Therefore, 50% of a month's inventory purchases are paid for in the month of purchase. The remaining 50% is paid in the following month. Accounts payable at March 31 for inventory purchases during March total $103,600